24 June 2024 12:20 am Views - 572
President Ranil Wickremesinghe
- Preparations underway to meet with creditor nations come Wednesday
- President stresses Sri Lanka’s return to business signifies a pivotal decision-making phase
The government expressed optimism about the country’s potential to shed its ‘bankrupt nation’ label in the coming weeks as a series of upcoming events are expected to assist in pushing the country into the next phase of recovery.
This week is expected to play a crucial role in determining the timing and extent to which Sri Lanka will be able to overcome issues with regard to its debt restructuring efforts and finalise agreements with its creditors, an endeavour that has been dragging for quite some time.
Come Wednesday, Sri Lanka will meet with its creditor nations, the Paris Club, India and others, to look at finalising matters regarding the debt restructuring efforts, according to President Ranil Wickremesinghe.
Wickremesinghe, shared that while relevant authorities will be meeting with the Official Creditor Committee (OCC), they will also be carrying out discussions with the Exim Bank of China this week.
‘‘And I hope by next week, or thereafter, that we will have come out of this phase of bankruptcy and into the next phase as we go ahead,” - President Ranil Wickremesinghe
“And I hope by next week, or thereafter, that we will have come out of this phase of bankruptcy and into the next phase as we go ahead,” the President said addressing the 31st All India Partner’s Meet 2024 (AIPM 2024) in Colombo.
The Executive Board of the International Monetary Fund (IMF), while commending Sri Lanka’s progress this month, stressed that important vulnerabilities and uncertainties remain regarding the ongoing debt restructuring and the upcoming elections.
President Wickremesinghe acknowledged that the two years since the economic crisis were “difficult” and noted that Sri Lanka survived it due to the US$ 3.5 billion loan extended by India.
He assured all will be repaid, just as the US$ 200 million loan to Bangladesh was settled.
Wickremesinghe stressed that Sri Lanka’s return to business signifies a pivotal decision-making phase and the key question is defining what this return entails.
“Returning to business as usual would mean continuing as an import-dependent economy, leading to on-going borrowing to fund imports and perpetuate a harmful cycle. Having faced this scenario before, the crucial question now is whether we are willing to repeat this path,” he said.
Alternatively, the objective is to gradually shift towards becoming a competitive, export-oriented economy, marking a significant goal.
While acknowledging the inherent challenges in this transformation, especially in Sri Lanka’s context, Wickremesinghe said the government has adopted a new approach: enacting legislative economic policies to effectively steer this transition.
Accordingly, Sri Lanka will introduce policies aimed at achieving economic transformation: moving towards a highly competitive, digital, green, and export-oriented economy.
“These policies will establish benchmarks for foreign investments, export earnings, and reducing multi-dimensional poverty—a first in our region,” he said.
Further, to maintain policy consistency as traditionally, policies in Sri Lanka have been subject to change with each new government, he noted the Economic Transformation Bill is drafted and is currently undergoing pre-legislative scrutiny in parliament and the courts.